3D retail store typology

Krasonikolakis, Ioannis, Vrechopoulos, A. and Pouloudi, N. (2011) 3D retail store typology. 16th International Conference on Corporate and Marketing Communications, Athens, Greece. 27 - 29 Apr 2011.

Abstract

The purpose of the present working paper is twofold. First, this paper studies the methodological issues of retail typologies in terms of store layout, both in conventional and online stores. Second, it proposes a robust methodology that should be followed in order to provide a typology of 3D retail stores in Virtual Worlds (VWs). VWs are 3-dimensional environments where users interact simultaneously through avatars, their in-world representatives (e.g. salesmen). They initially adopted a gaming orientation but soon retailing activity became a real phenomenon. Some of VWs retain an in-world currency and users can buy or sell virtual or real goods. “Second Life” is considered a leader, and user-to-user transactions for the first quarter of 2009 reached 120 million US dollars (Second Life blog, 2011).

In the extant literature, there are several studies attempting to classify retail store layouts in traditional and online environments. There is evidence that store layout is an important influencing factor affecting consumer behavior (Levy and Weitz, 2004; Bitner, 1992). Specifically, Levy and Weitz (2004) describe the three established layout types in conventional retailing: free form, grid, and racetrack. However, an endeavor to locate the methodology (literature review), through which these layout types have been defined, proved fruitless. An online communication with several academics who all have extensive research work on this topic, confirmed the lack of such a methodology. Probably, the three layout types stem from business practice. However, with new environments emerging in the online context, such as VWs, bringing new features and capabilities in the retail process, we argue that a systematic and robust methodology to classify 3D retail stores is needed.

To this end we propose a four step methodology. The first step is comprised of three processes that can run in parallel. Specifically, based on a literature review of store layout in traditional and online retailing (i.e. 2D), the relevant characteristics that also appear in VW environments should be gathered. Also, the examination of current business practice will help in order to find the characteristics of retail stores (in terms of layout) that do not exist in the other two retailing channels. Lastly, the Delphi technique which relies on a panel of experts can be adopted, in order to find whether there are characteristics that do not appear in academic research works and the researchers did not notice while reviewing current business practice. The outcome of the first step will be an extended list of store layout characteristics in the context of VWs 3D retailing. The second step of the methodology will be to select an adequate number of retail stores in VWs, in order to evaluate these characteristics, based on objective criteria. A scale should be developed for each one of these characteristics. The third step of the methodology will be to adopt marketing research tools such as Cluster Analysis and Multiple Discriminant Analysis (MDA) in order to examine if there are different clusters and whether there are significant differences among them (i.e. predictor variables derived through MDA). The fourth step will be to ask consumers’ opinion in order to validate that consumers perceive in the same way the various types of store layout as they derived through the statistical research analysis. Finally, a labeling along with a detailed profiling of each cluster will follow.

VWs have become an emerging alternative retail channel in recent years. They can adopt all the capabilities that are available in 2-dimensional online environments and also, they can simulate processes and features of traditional retail stores (e.g. social interaction through avatars). The influence of store layout in 3-dimensional environments on consumer behavior, apart from the theoretical contribution, will help managers build their 3-dimensional retail stores in a way that will meet their customers’ needs.

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